Month: June 2018

Morgan Housel on how long tails drive everything, not just VC returns (1,150 words) – Although Disney had hundreds of hours of film by 1938, the only one that mattered financially was Snow White. The gain in the S&P 500 is driven by a smaller percentage of companies. The reason Berkshire Hathaway was so much better than its competitors was because of just a few investments. And of course, “reading this means you belong to the only species out of 8.7 million on this planet that can read. And our planet is the only one out of 100 billion in our galaxy that we know has life. So just reading this article is the result of the longest tail you can imagine.”

Castration through the ages (1,900 words) – Eunuchs were taller and stronger than normal men on average. Castration is obviously viewed as a punishment nowadays, but there were times in history when people volunteered for it.

Tyler Cowen on immigration (800 words) – “The higher a migrant’s chance of being able to remain in the U.S., and of being treated humanely along the way, the more migrants will come and the greater the risks they will take to get here. Unfortunately, that will mean higher death rates and also more risk to children. Many EU nations offer subsidies to help asylum-seekers to resettle, for instance, but that also encourages more people to attempt the journey; by one estimate, in the last quarter century more than 33,000 migrants and refugees have died trying to reach Europe.” In other words, immigration is hard. Tyler’s prescription? “So my grand immigration bargain looks like this: much more legal immigration, safe routes of transit, better enforcement at the border and restricted asylum rights. Right now, that seems far away. In the meantime, the problems will fester.”

The decline of NYC (13,500 words) – Kevin Baker laments how NYC has changed for the worse; his complaints are applicable in one way or another to all large American cities, and probably all large cities in the world. The cost of living in NYC has increased much faster than the wages earned by the lower and middle classes, making it more and more unaffordable. Homelessness is a bigger problem now more than ever, and the lower and middle classes are subsidizing the ultra-wealthy because of how tax revenues are deployed. Many of the new luxury apartments that are built are vacant or purchased by foreign billionaires who use the apartments either as an investment or a store of value.

Ben Thompson on electric scooters – American cities are designed for cars, not bikes and scooters. If we could magically change most cities from being car-centric cities to bike-and-scooter-centric cities, we’d be much better off, but getting from here to there is immensely, maybe impossibly, difficult. Ben also covers Uber’s mistake in entering the race for autonomous vehicles and how scooters and bikes give the company a second chance to get its strategy right.

Why do males exist? Asks Robin Hanson – Plants are hermaphrodites, so they benefit from having two parents for gene diversity while ensuring that each member contributes equally. Why animals can’t do the same isn’t clear, and competing for mates isn’t an answer since plants also compete for mates.

John Cochrane uses air ambulances as an example to show why cross-subsidies are so bad – Consumers that can afford air ambulances pay more so that poor consumers have the opportunity to pay less; this is how things should be, but the way we get that to happen is inefficient. Instead of cross subsidies, Cochrane says that we should instead tax the rich to help the poor pay. Currently the regulations from the cross subsidies limit supply, causing exorbitant prices that wouldn’t exist in a competitive market with more suppliers.

Scott Alexander on arbitrary deploring – Scott pushes back on Bryan Caplan’s assertion that we deplore people disproportionately; in Caplan’s examples, we seem to be punishing disproportionately because we are enforcing norms, norms that we as a society agree must be adhered to.

Russ Roberts interviews Eric Topol – Great discussion about medical paternity. Many doctors withhold notes and decisions from patients under the pretext that the doctor knows best. We should instead be having healthy discussions between doctor and patient since sometimes that patient knows his/her body better than the doctor does. We expect financial advisers, lawyers, and our government to be transparent and don’t allow them to act autonomously under the guise of them “knowing best,” so why should we allow our doctors to do so? The Theranos discussion hasn’t aged well, but the rest of the interview is fantastic.

Mark Schreiber on how the name “Mao suit” came to be – The suit Kim Jong Un wears is called the “Mao suit” by English news services but is called the “Sun Yat-sen suit” (Zhongshan-zhuang) by the Chinese living in Asia. Interestingly, the name Zhongshan was a name adopted by Sun Yat-sen when he was in Japan out of fear of being abducted by agents of the Chinese imperial government. Therefore, the streets in China named Zhongshan road and the “Sun Yat-sen suit” originated from a Japanese alias, which is ironic because of the animosity historically between China and Japan.

Scott Alexander on suicide rates and guns – The US is an outlier in homicide rates but not in suicide rates even though there is a clear relationship between gun ownership and suicide rates but not between gun ownership and homicide rates. His conclusion is that if the US decreased its gun ownership, it would probably have even lower suicide rates and would be among the lowest in the developed world. He doesn’t mention it in this article, but conversely, decreasing gun ownership might not significantly decrease homicide rates.

Russ Roberts interviews Michael O’Hare about art museums – I learned so much from this podcast episode. The largest art museums only show around 5% of their collection at any given time, and since they continually acquire more art and perpetually display their staples, the majority of their collection never sees the light of day. O’Hare asserts that selling just 1% of their collection would not only allow the most well-known museums to fund admissions for perpetuity so that everyone could see their art for free, but would also give smaller art museums the opportunity to acquire more well-known works that currently aren’t seen by anyone. However, the current system all but prevents art directors from selling anything in their collection unless it is to acquire other works. So, we end up in a position nobody wants to be in: the largest art museums have so many works that will never see the light of day, works that smaller museums would kill for, and we have to pay ever increasing admission prices, ostensibly to provide the money “needed for a museum to operate.”

“The Education Tax Reduces Inequality and the Incentive to Work” – By Alex Tabarrok using data from David Leonhardt. College tuition is so much more expensive for Affluent families (~186k in income) than Upper-Middle families (~123k in income) that the earnings gap between them is smaller than first glance. Based on the data, when an Affluent family has 2 kids in college, their take adjusted income is actually less than an Upper-Middle class family. The post was thought provoking but I’m highly skeptical about this reducing the incentives of workers to earn more money.

The Verge article by Christine MacDonald on how Coca-Cola isn’t really water neutral – Good news: Coca-Cola is “water neutral,”ostensibly meaning that it gives back the same amount of water it uses. Bad news: its method of calculating its water use leaves out ~99% of its actual water use since it is only counting the water used in production, not the amount in its entire supply chain. For example, a half-liter of Coke takes ~35 liters of water to make (28L for growing sugar beets, 7L for the plastic bottle, and 0.4L for the actual liquid), but Coca-Cola is only counting its water use as 0.4L.

Helen Rosner on MSG – Mind blown. I had no idea that it’s been known for a while that MSG is not bad for you, despite the public perception, even among Asians, that it is. Why the perception? It originated from bad science, and possibly a dose of racism/xenophobia and then stuck despite many studies that have since debunked the myth. That it stuck illustrates the power of inertia and the difficulty in changing public opinion.